Robert Moskow, an analyst from TD Cowen, maintained the Hold rating on Kraft Heinz. The associated price target was raised to $28.00.
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Robert Moskow has given his Hold rating due to a combination of factors impacting Kraft Heinz’s performance. Despite the company’s second-quarter sales exceeding expectations, there remains skepticism about the U.S. market’s ability to return to growth in the near term, as multiple brands face challenges simultaneously. The management’s ongoing evaluation of strategic options for the portfolio has not yet resulted in any concrete actions, and potential benefits from a portfolio split appear limited.
Moreover, while there has been some improvement in organic sales growth, a significant portion of Kraft Heinz’s retail brands continue to struggle, particularly in categories like cold cuts and Lunchables. Additionally, the company’s guidance for the third quarter suggests a decline in operating profit and gross margin, partly due to the timing of promotions and commodity inflation. These factors contribute to a cautious outlook, justifying the Hold rating.
In another report released yesterday, Jefferies also reiterated a Hold rating on the stock with a $28.00 price target.